The Chairman of AWB International Limited (AWBI), Brendan Stewart, today announced that the AWBI Board is implementing further reforms in response to the 2004 Wheat Marketing Review.
Mr Stewart said more than half of all recommendations from the review into AWBI’s management of the Single Desk system for wheat marketing are being implemented and progress is being made on assessing all remaining recommendations.
The details of AWBI’s response to the recommendations are contained in a report to the Minister for Agriculture, Fisheries and Forestry and the Grains Council of Australia and will be made available to all growers. As per the Government’s timelines the second progress report is scheduled for December 2005.
Mr Stewart said key areas covered by AWBI in the June report include:
- Improving transparency by expanding the Statement of Financial Performance commencing with the 04/05 National Pool Performance Report;
- Altering the remuneration model to set the base fee according to the costs of providing the services required to manage the Pool;
- Details of proposals presented to shareholders at the 2005 AGM to provide more independent directors in the board of AWBI;
- Reviewing incentives for National Pool staff based on measures aligned with maximising pool returns and the WIB;
- A revision of financial incentives to ensure AWB Limited has a financial incentive to pursue longer term marketing objectives;
- A review of chartering and the Wheat Industry Benchmark; and
- The requirement for the GM AWBI to attest directly to the Board of AWBI on matters of risk
Mr Stewart said with constitutional obligations to Australian wheat growers, AWBI is required to fully assess and implement proposed reforms that will strengthen the Single Desk.
“Many recommendations need additional due diligence, including cost/benefit analysis and impact assessments, before AWBI can provide a definitive response,” Mr Stewart said.
“This process also included consultation with the Grains Council of Australia (GCA) and other industry stakeholders, including the Wheat Export Authority,” Mr Stewart said.
Further to this, the AWBI Board has also initiated a consultation process with state affiliate grower representative groups and the GCA to specifically address the important issue of recommendations regarding the structure of the AWBI Board. Further announcements on this key issue are expected to be made in the December Minister’s report.
In October last year, the Independent Panel conducting the Wheat Marketing Review released its report which commended AWB on its performance in managing the Single Desk. The report specifically praised AWB’s performance in maintaining returns to growers, reducing supply chain costs, improving price signals to growers through Golden Rewards and significantly improving grower communications.
While commending AWBI, the Panel made a number of suggestions to improve the administration of the export system, which forms the majority of the content of AWBI’s response to the Minister.
“AWBI is committed to implementing reforms that will make the management and operation of the Single Desk even stronger. These reforms will build on the recently launched “Shaping the Future” campaign which is designed to shift the quality profile of the national wheat crop to capture more of the higher value, differentiated markets,” said Mr Stewart.
A copy of AWBI’s progress report to the Minister is publicly available at www.awb.com.au